September 30, 2011

If the law is as unpopular as it seems to be, and if the individual mandate is “the most hated piece of the law,” then the Court, by removing the threat of the law, or at least the mandate, on constitutional grounds, would remove a big reason to oppose Obama, no? Health care “repealers” could reelect the President without fear that he’d require them to buy insurance–or, if the entire law collapses, without fear that the law would not be repealed over his veto.

Interesting. I had mumbled something similar earlier this week before deciding against the idea:

Obamacare does not poll well and Republicans will be campaigning on its repeal whatever the Supremes decide. And (just thinking out loud here) Obama might actually benefit from a Supreme Court ruling against Obamacare, since it would give him an excuse to give the people what they want. Put another way, if the Supreme Court upholds Obamacare it will be obvious that the only way to end it is to end Obama's reign.

Interesting point, but having a conservative Court uphold the mandate would be a huge psychological boost for Obama and the left and might even help legitimize the program to independents who have been lukewarm about it until now. Don’t forget either that the White House is expecting Romney to be the GOP nominee. Even if grassroots conservatives feel energized by the Court decision, how jacked up can they be to replace Obama with … the architect of RomneyCare, who did more than anyone else until The One himself to introduce health-care mandates to America?

What I can’t figure out, though, is why O would run the risk of the mandate being struck down before the election. That would be demoralizing for the left and delegitimizing for Obama. What’s left of his first term if his signature domestic policy “achievement” ends up rubbished by SCOTUS as a violation of the Commerce Clause? I guess the thinking is that if the mandate is struck down, he can point to it as proof for liberals that they desperately need to appoint more left-wing justices to the Court and the only way to do that is to re-elect him. But even so, Obama’s not the kind of guy who wants to deal with X factors in the middle of the campaign: That’s why the Bush tax cuts were extended until after election day and why he insisted on a debt-ceiling deal that would carry through past November of next year. Now suddenly, by bypassing the 11th Circuit rehearing, he’s risking the Court dropping a flaming bag of shinola on his doorstep four months before the polls open. He must be awwwwwwfully confident that he’s going to win.

It's possible that Obama is a victim of lefty epistemic closure, where everyone he knows thinks ObamaCare is the cat's meow. Or, he may have experts telling him he will win at the Supreme Court. Here is Orin Kerr predicting that the mandate will be upheld with 6 to 8 votes (Thomas is his only sure "no".) Eva Rodriguez at the WaPo makes a similar calculation, as does Robert Barnes.

Or for more fanciful thinking - would a Supreme Court rejection of the individual mandate re-vitalize the left by reviving the public option? I can't imagine Obama wanting to run on "Health Care II - This Times, Let's Keep It Legal", but who knows?

The Man Who Got Osama has now killed his first American. From the Times:

SANA, Yemen — A missile fired from an American drone aircraft in Yemen on Friday killed Anwar al-Awlaki, the radical American-born cleric who was a leading figure in Al Qaeda’s affiliate in this country, according to an official in Washington.

The Times is pretty light on the civil liberties controversy:

The missile strike appeared to be the first time in the United States-led war on terrorism since the Sept. 11, 2001, attacks that an American citizen had been deliberately targeted and killed by American forces.

...The Obama administration has escalated military and intelligence operations in Yemen, and the White House decision to make Mr. Awlaki a top priority to be hunted down and killed was controversial, given his American citizenship.

In early February 2010 – fewer than two months after failed Christmas Day underwear bomber Umar Faruq Abdulmuttalab, who had links to Awlaki, tried to strike – the National Security Staff put out an early directive saying Awlaki is a valid target for killing. Since the cleric was an American citizen, administration lawyers vetted the argument, ultimately concluding that Awlaki was a viable target since he cannot be captured.

Let's have more on the controversy. Yesterday, writing in the LA Times, Jonathan Turley declared President Obama to be "a disaster for civil liberties". (Of course, others on the left are still furious that the Obama didn't push for single-payer healthcare and make the government everyone's doctor, so where is the progressive constancy on civil liberties, hmm? But I digress). Back to Mr. Turley:

Obama failed to close Guantanamo Bay as promised. He continued warrantless surveillance and military tribunals that denied defendants basic rights. He asserted the right to kill U.S. citizens he views as terrorists. His administration has fought to block dozens of public-interest lawsuits challenging privacy violations and presidential abuses.

Glenn Greenwald rages about Al-Awlaki at Salon. Let me just pick up on this hyperbole:

When Awlaki's father sought a court order barring Obama from killing his son, the DOJ argued, among other things, that such decisions were "state secrets" and thus beyond the scrutiny of the courts. He was simply ordered killed by the President: his judge, jury and executioner.

Wait, Obama was the "executioner"? Was our former community organizer also a Predator drone operator or CIA wetworks operator before moving into the White House? Who knew?

Adam Serwer of TAP provides a similar example of slack thinking in this earlier denunciation of the Al-Awlaki case:

I can't get past the fact that what they add up to is the idea that the president can have someone executed on his say-so based on mere suspicion of a crime, as long as it declares doing so a state secret.

My emphasis. Back in reality, President Obama can not simply wake up one morning, announce to his staff that he is fed up with Paul Krugman's criticism, order the Predator drones to commence circling Princeton, and see Krugman delivered on a platter (or more likely, as a splatter.) Pentagon lawyers would study the hell out of such a order before proceeding; since military officers are only sworn to uphold lawful orders, Krugman would be safe until his case cleared an intensive internal review (which it never would).

My concluding thought - I'll accept at face value that it might have been virtually impossible to arrest Al-Awlaki. But let me add that the Administration would really rather not have arrested him, since that would have re-opened the whole controversy about where to imprison and try these Qaeda operatives. Could the Administration have argued that Al-Awlaki was an enemy combatant subject to Gitmo and military commissions, or would they have been obliged to conduct a public trial in the States? And wouldn't Eric Holder (who wanted to try non-citizen KSM in Manhattan) be obliged to offer Al-Awlaki a similar propaganda platform?

Al-Awlaki dead renders these questions moot and saves the Administaration a lot of schizophrenic voguing.

JUST THINKING OUT LOUD... It's a bit counter-intuitive that it would be illegal for the Administration to tap Al-Awlaki's phone calls without a FISA warrant but it's OK to wack him. However, the phone tapping is illegal because of the Constitutionally questionable FISA signed by Jimmy Carter; one presumes that Congress could pass a law similar to FISA covering targeted assassinations and the President could sign it. But I don't see much push for that happening. The President would prefer to hold on to Executive authority (real or imagined) and the Congress would prefer to duck their own responsibility (as they did with Libya and the War Powers Act).

September 29, 2011

I don't remember a night with more baseball drama spanning more cities with more teams playing back-against-the-wall baseball.

In Tampa Bay, the Rays make it all the way back from a 7-0 deficit with six in the eighth, a two-out solo shot in thre bottom of the ninth, and a walk-off blast by Evan Longoria in the 12th.

Meanwhile, back in Baltimore, a rain delay had kept the Red Sox in check with a 3-2 lead in the seventh. By the time play resumed, the Rays and Yanks were playing free baseball. The Sox had runners on first and third with no outs in the top of the ninth but failed to pad their lead. In the bottom of the ninth Sox closer Jonathan Papelbon (who has had a terrific year but a grim September) got two quick strikeouts before giving up a double, another double and a single. Carl Crawford endied his season from hell by missing a sliding catch on the final play. Yike. Moments later Tampa Bay formally ended the Red Sox season.

And for fans of minor league baseball, the Atlanta Braves completed their epic fail by losing to the Phillies in extra innings.

I the Bold Prediction department I am gloomily resigned to watching the Phillies outpitch the Yankees in the Series.

September 28, 2011

Salon makes an unconvincing case against Christie having base appeal in the Republican Party:

Immigration : Last year, he lashed out at political leaders who "demagogue" immigration, argued that the issue should be handled by the federal government (and not individual states, like Arizona), and called for a "clear" path to citizenship for illegal immigrants now in the country. He went much farther in 2008, back when he was U.S. Attorney for New Jersey, telling residents at a town meeting that "[b]eing in this country without proper documentation is not a crime" and that his office had no business dealing with illegal immigration cases.

First, the current right-wing position is not a conventional Federalist argument that immigration ought to handled at the state level for the same reasons that apply to, for example, education. The right-wing view is that Obama has abdicated the Federal responsibility to secure the borders, so states need to be given latitude to fill the void.

CHRIS WALLACE, FOX NEWS: Congresswoman Bachmann, as you well know, a number of states are trying to crack down on illegal immigration. We got a bunch of questions on immigration like this one from Tim Emerson, this is a text question so you don't need to look up there. Tim Emerson of California.

He wrote this, "would you support each state enforcing the immigration laws since the federal government is not?"

Congresswoman, could you answer Tim's question? And if your answer is yes, how do you square that with the constitution which says that congress has the power to establish a uniform rule of naturalization?

BACHMANN: Well, the reason why he's asking this question is because the federal government has failed the American people and has failed the states. It's reprehensible that President Obama has sued the state of Arizona and the governor of Arizona for trying to protect the people in Arizona. That's wrong.

(APPLAUSE)

BACHMANN: As president of the United States, I would do what my job would demand of me. That's to uphold the sovereignty of the United States of America.

But as Salon eventually notes it is not just what you say, it is how you say it:

That said, there's another reason for Perry's struggles, one that may offer Christie a glimmer of hope: He's really bad at explaining himself. Take his statement during last week's debate that those who object to the children of illegal immigrants receiving in-state tuition "don't have a heart." This was needlessly defiant, something that made it much tougher for conservatives who disagree with his policy to give Perry the benefit of the doubt. There's reason to believe that Christie wouldn't make this kind of mistake. He's an uncommonly talented communicator, quick on his feet and adept at fielding any question, no matter how hostile, and shifting the discussion to an area where he's comfortable. You probably wouldn't see him suffer through a moment like this in a debate. So it's at least possible that Christie is a strong enough salesman that he could persuade the right to look the other way when it comes to his various crimes against conservatism.

As best I can tell, Christie has not committed himself to a Bush/Obama style "Grand Compromise" on immigration, in which border security, workplace enforcement and a "path" to citenship are resolved simultaneously, after which border security and workplace enforcement are ignored by the Feds, as in 1986. Consequently, I suspect Christie could talk himslef past any immigration problems.

But can he talk himself past his Bernie Madoff connection? Yike! From his Wiki-bio I see that he lobbied on behalf of Bernie in the 1999-2001 era. All very defensible intellectually, but oh, brother.

Well, this is a reminder of how clever Obama has been in sitting on his law firm billing records.

September 27, 2011

The NY Times may lose their opportunity to endorse Jon Huntsman in the Republican primaries:

Jon Huntsman, the former governor of Utah, has been in every presidential debate since he threw his hat in the ring last June.

Now, that may change.

CNN, which is hosting a debate in Las Vegas on Oct. 18, has set criteria for participation that Mr. Huntsman — at this point — has not managed to meet.

The network has said candidates must reach an average level of support of 2 percent in three separate polls by news organizations published since Sept. 1. Mr. Huntsman has reached 2 percent in two polls, but has been at 1 percent in the rest.

If he doesn’t reach 2 percent in a third poll by Oct. 16, Mr. Huntsman will not be on the stage. Sam Feist, the Washington bureau chief for CNN, said Monday that the network set the 2 percent floor months ago and hasn’t changed it.

Geez, I guess Huntsman's "Vote for me if you hate conservatives as much as I do" message hasn't caught fire amongst Republicans. Oh, well - the Times was not going to endorse Huntsman in the general election anyway (but don't tell Huntsman that!).

I presume this also bodes poorly for Governor Johnson, the libertarian from New Mexico, who barely crept into the Fox debate by scoring 1% (or better) in five recent polls in which he was included. OTOH, per the Polling Report, Gov. Johnson was at 2% in the McClatchy-Marist Poll. Aug. 2-4, the CNN/ORC Poll. Aug. 24-25, the, hmm, Gallup Poll. May 20-24 and the USA Today/Gallup Poll. June 8-11. None of those are after Sept 1, and I see that in the Sept USA Today and McClatchy polls Johnson was not included.

September 26, 2011

Brad DeLong reviews Ron Suskind's "The Confidence Men" and includes this anecdote about Obama and his economic team:

[Summers and Romer] were concerned by something the president had said in a morning briefing: that he thought the high unemployment was due to productivity gains in the economy. Summers and Romer were startled. "What was driving unemployment was clearly deficient aggregate demand," Romer said. "We wondered where this could have been coming from. We both tried to convince him otherwise. He wouldn't budge." Summers had been focused intently on how to spur demand, and on what might drive a meaningful recovery.... [W]ithout a rise in demand, in Summers's view, nothing else would work.... But productivity?... If Obama felt that 10 percent unemployment was the product of sound, productivity-driven decisions by American business, then short-term government measures to spur hiring were not only futile but unwise. The two economists strained their memory... had they said something he'd misconstrued?... After a month, frustration turned to resignation. "The president seems to have developed his own view," Romer said.

The President had developed his own view? The President was chanelling his inner Karl Marx, who expounded about the Reserve Army of the Unemployed displaced by the substitution of capital for labor. In fact, Obama has cited the displacement of bank tellers by ATMs repeatedly.

Is there any chance Obama did not read and love Kurt Vonnegut's 'Player Piano' back in his hipster college days?

Apparently Monday is a big day for Team Obama, which can decide whether to delay a Supreme Court decision on ObamaCare until after the 2012 election:

Reporting from Washington—

Obama administration lawyers face a decision by Monday that carries a high political risk and will probably determine whether the Supreme Court decides on the constitutionality of the healthcare law before next year's presidential election.

The Justice Department could ask the full U.S. 11th Circuit Court of Appeals in Atlanta to reconsider a 2-1 decision in August that declared the law's mandate that all Americans must have health insurance unconstitutional. But seeking the full court review could take weeks, or even months, and probably push back a Supreme Court ruling until 2013.

Or government lawyers could opt to skip the full review in the lower court and appeal directly to the Supreme Court this fall. That in turn will probably lead to a constitutional ruling on President Obama's healthcare law by next summer.

Under the appeals court's rules, the Justice Department must notify the 11th Circuit by Monday whether it will seek a full court review. In recent weeks, lawyers on both sides of the case have been speculating on whether Obama's legal team is eager to get the healthcare dispute before the Supreme Court soon, even if it means risking an embarrassing defeat for the president as he seeks reelection.

Do they take a knee and head for the half-time locker room, or run a play? Obamacare does not poll well and Republicans will be campaigning on its repeal whatever the Supremes decide. And (just thinking out loud here) Obama might actually benefit from a Supreme Court ruling against Obamacare, since it would give him an excuse to give the people what they want. Put another way, if the Supreme Court upholds Obamacare it will be obvious that the only way to end it is to end Obama's reign.

That said, it is a bit awkward that our genius President and law school lecturer on the Constitution would have blundered on the mandate, but then again, Obama never supported a mandate as a candidate.

Naah. Delay is the only sensible choice for them. The strategic bet is that some of the folks who don't like ObamaCare will figure that the courts will end it, and they will vote Democratic for other reasons. A Supreme Cout ruling against ObamaCare will energize Republicans; a Supreme Court ruling in its favor will double-energize them.

UPDATE: It's on to the Supremes, in what Politico describes as a show of confidence by the confidence men at Team Obama. At the SCOTUSBlog, Lyle Denniston explains how the Supremes might take up a case yet duck a decision.

William Galston, writing in TNR, describes a very interesting Pew survey:

In mid-2005, as disaffection with the Bush administration and the Republican Party was gathering momentum, the Pew Research Center asked American to place themselves and the political parties on a standard left-right ideological continuum. At that time, average voters saw themselves as just right of center and equidistant from the two political parties. Independents considered themselves twice as far away from the Republican Party as from the Democrats, presaging their sharp shift toward the Democrats in the 2006 mid-term election.

In August of this year, Pew posed a very similar question (note to survey wonks: Pew used a five-point scale, versus six in 2005), but the results were very different. Although average voters continue to see themselves as just right of center, they now place themselves twice as far away from the Democratic Party as from the Republicans. In addition, Independents now see themselves as significantly closer to the Republican Party, reversing their perceptions of six years ago.

That bodes well for the Reps, but let's get to the wet fish and the self-awareness crisis of the left:

There’s another difference as well. In 2005, Republicans’ and Democrats’ views of their own parties dovetailed with the perceptions of the electorate as a whole. Today, while voters as a whole agree with Republicans’ evaluation of their party as conservative, they disagree with Democrats, who on average see their party as moderate rather than liberal. So when Independents, who see themselves as modestly right of center, say that Democrats are too liberal, average Democrats can’t imagine what they’re talking about.

Well, that provides a hint as to why libs don't think the media has a leftward tilt. Anyway, what's the first step in AA? I foresee a new "Progressives Anonymous" program where people stand up in meetings and introduce themselves with "I am Bill, I am a progressive, and I am so far from the political mainstream I can't even feel the river." Fellow attendees can then exchange bon mots from The Daily Kos and reminisce about the dark days under evil, intrusive BushCo (were you on a no-fly list too?).

September 24, 2011

At the Thursday night debate Herman Cain told an engaging but implausible story abut how he is only alive (as a cancer survivor) because he was not subject to the inevitable bureaucratic wrangling of ObamaCare.

Gee, what kind of insurance is Mr. Cain on now, and why is he so sure it will be radically different unde ObamaCare? Beats me, but if Mr. Cain rises in he polls the Big Media will be all over that story (he is not The One, after all). And frankly, I would be shocked if it survived a fact check.

Kevin Drum makes this point a bit more forcefully but also provides some insight into the current progressive catechism:

Not to put too fine a point on it, but this is a real problem for liberals. Sure, we cherry-pick evidence, we spin world events, and we impose our worldview when we talk about policy. Everyone does that. But generally speaking, our opinion leaders don't go on national TV, look straight into the camera, and just outright lie about stuff. Theirs do. And you know, if you'd been told over and over that Obamacare meant getting government permission every time you want to go to the doctor; if you'd been told over and over that the economy is in bad shape because a tidal wave of regulations are strangling American business; and if you'd been told over and over that stimulus spending didn't create one single job — well, what would you think about Barack Obama's presidency? Not much, I imagine.

It's awfully hard to fight stuff this brazen.

Hmm. If we had been told over and over that defeat was inevitable in Iraq... never mind. Kevin's ability to distinguish between fact and opinion seems to be under-developed. "2+2=4" can serve as an example of a fact; "if Herman Cain's health plan saved his life and if his health plan wouldn't change under ObamaCare, then he would have lived under ObamaCare" is a very defensible syllogism.

I don't know what Mr. Cain's current plan is, I don't know whether it would survive the transition to ObamaCare, and I don't know what the impact of 40 million new subsidized enrollees will be on the accessibility of CAT scanners (neither does Kevin). Still, it strikes me as highly unlikely that Mr. Cain's story is accurate.

But Kevin's other facts? Please. Is "a tidal wave of regulations...strangling American business"? I know Krugman says it isn't, but others consider the question to be quite difficult and I am quite certain neither side can provide proof of of their view. And just offhand, I think there is a lot less drilling in the Gulf than there might be.

As to "stimulus spending didn't create one single job", well, some fairly well-credentialed economists have come to that conclusion. Again, pick your pony but don't tell me there is not even a race.

September 23, 2011

With taxes on the wealthy on the political radar, we’re going to drowning in a vast wave of double-talk and smothered by vast amounts of fuzzy math. Still, one has to try. So, a couple of notes.

One is that you have to beware of the old trick of saying “taxes”, then slipping into “income taxes”. Most Americans pay more payroll than income taxes, but the reverse is true at high incomes. So focusing only on income taxes makes it seem as if the rich pay much more of the burden than they really do.

Well, the question of how to think about Social Security and Medicare is vexatious. In other venues, and for decades, advocates of Social Security have promoted it as an "earned benefit". Here, for example, is Bernie Sanders writing last week in favor of higher Social Security taxes:

It is the one earned benefit program upon which they [older Americans] can depend. They know that they have paid into Social Security and they have earned the benefits due them by our government.

Well, fine. If it is an earned benefit then we can mimic the activity of the Social Security actuaries and track a person's dollars in with the eventual dollars taken out. And the upshot? Social Security tends to be somewhat re-distributive, favoring lower lifetime earners over hgher ones. Krugman himself made this point when it helped him bash Bush:

...the formula determining Social Security benefits is progressive: it provides more benefits, as a percentage of earnings, to low-income workers than to high-income workers.

And Medicare is clearly tilted towards lower earners, since everyone gets the same benefit regardless of their contribution.

So - in assessing the tax burden faced by Americans one might reasonably ignore both Social Security taxes and benefits, figuring that on net, the program favors lower earners.

But that would be tricksie! Becasue when the burden of taxes is the topic, Krugman et al prefer to pretend that Social Security is just one more "pay as you go" government program. In this formulation Social Security's current costs and eventual benefits have no more link than the connection between a person's income taxes paid and their benefit from the national defense budget.

Hmm. As a political calculation, the marketing appeal of the "earned benefit" approach is obvious. Still, I am not sure why progressives think we should be taxing working class laborers so that well-off retirees can cavort in Miami. Just why are Social Security benefits higher for formerly high-earning retirees with ample retirement savings? Surely Social Security and Medicare should be means-tested if they are just "pay-go" transfer schemes intended to lift the elderly out of poverty? I don't notice Warren Buffett clamoring to have his Social Security benefit knocked down to zero and his Medicare beneift suspended, but that would be a logical policy for him to advocate if he wanted to save Social Security. (Soc Sec benefits are taxable, but that puts the receipts in the general fund; means-testing the beneift would keep the money in the Soc Sec Administration budget.)

If Democrats want to step forward in favor of means-testing the Social Security benefit then I will take them seriously that it is a pay-go scheme. If they want to hide behind the "earned benefit" marketing pitch, then they should man up and drop it from their tax burden calculations.

SOMEBODY CALL 9-9-9: Since you asked, I would be fine with scrapping the (regressive) payroll tax and replacing it with a (regressive) national sales tax, or VAT, or some such tax on consumption rather than work. But Roosevelt's acolytes on the left will never agree.

The Republican Party does not normally seek out fresh faces in their nominating process. Bush 43 cut to the front of the line based on his family name and I suppose Barry Goldwater came from nowhere in 1964, but otherwise the party likes to nominate familiar faces - I am thinking of Reagan, Bush 41, Dole, and McCain in 2008. My theory - we Like Ike and love Reagan, so going with a grey-haired veteran of the political wars is fine.

(By way of contrast, Dems are always in search of the next JFK. They need someone young and charismatic who has not actually taken positions or developed a track record that will antagonize some portion of their fractious base. By this rule, John Edwards should have defeated John Kerry in 2004, but I guess Kerry was unobjectionable enough, and he had an actual Kennedy in his corner.)

But 2012 will be different - setting aside Ron Paul, the only declared candidate that is back from 2008 is the shape-shifting Mitt Romney. On the other hand, the current field is, hmm, susceptible to improvement.

Rick Perry looks like a Central Casting President, but he carries the "fresh face" burden and he is increasingly annoying on immigration. As I recall (and pending a moment's research) he has been panned for fading in each of his debate appearances.

OTOH, Mitt Romney is the other Central Casting candidate, he is a familiar face, and he should do well in New Hampshire.

So, do Republicans embrace the familiar and get behind Mitt? Do we hold out for a re-tread like Sarah? Do we hold out for yet another fresh face like Chris Christie?

It's a bit early to say this is over, but as a public service announcement I offer the advice that Mitt wil be the one to oppose The One. People can start practicing their teeth-gritting nose-hold-while-filling-in-the-ballot right now.

"If something travels faster than the cosmic speed limit, then it becomes possible to send information into the past - in other words, time travel into the past would become possible. That does not mean we'll be building time-machines anytime soon though - there is quite a gulf between a time-travelling neutrino to a time-travelling human."

Well, there is a clue to the answer. Is anyone receiving information from the future? Either (a) the technological problems were never solved (Ever!), or (b) nobody from the future wants to communicate with us, or (c) we need to invent the right receiver and have yet to do so, or (d) the experimental data is awry and the speed of light remains inviolate.

I deem (a) and (b) to be out of the question. So, in order to validate the results these scientists ought to think about what a receiver might look like.

Senate candidate and Harvard prof Elizabeth Warren is winning kudos on the left for her passionate defense of collectivization:

For those who can’t watch clips online, Warren, after explaining some of the reasons for the nation’s deep fiscal hole, pointed to a more sensible approach to economic policy in general. “I hear all this, you know, ‘Well, this is class warfare, this is whatever,’” she said. “No. There is nobody in this country who got rich on his own. Nobody.

“You built a factory out there? Good for you. But I want to be clear: you moved your goods to market on the roads the rest of us paid for; you hired workers the rest of us paid to educate; you were safe in your factory because of police forces and fire forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory, and hire someone to protect against this, because of the work the rest of us did.

“Now look, you built a factory and it turned into something terrific, or a great idea? God bless. Keep a big hunk of it. But part of the underlying social contract is you take a hunk of that and pay forward for the next kid who comes along.”

We stand on the shoulders of giants - no kidding. Ms. Warren is very convincing that those darn rich people ought to be paying some taxes. But wait! They already are!

As to how her argument explains why a factory owner ought to be paying even more taxes, well, I don't know. And to relate it to a hedge-fund hero who could re-incorporate in an off shore tax haven? Forget it. However, there is an annotated response to her posted at InstaPundit highlighting the abusrdity of some of her claims. For example, if union thugs shut down the factor, Ms. Warren would cheer, not send the police.

But I have a problem with her premise, that all your work are belong to us. "We" educated the workers? Even the home-schooled ones? The private-school and Catholic school grads?

"We" built the roads? A factory can be located anywhere in the world. If the numbers for transportation and access to workers make sense, it will be built in Malaysia. If a property is near a good US transportation hub, it may be more valuable, and the land rent will be higher. If the factory owner chooses to pay that higher rent in the US, well, Ms. Warren should be railing at the land-owner. Who of course is subject to property taxes.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.

I suppose We the People could yet choose to fullfill Obama's college fantasies and organize as a Euro-style socialist state. But in a land of freedom and opportunity, one might argue (Ms. Warren would not, apparently) that people's freedom comes from God, not Ms. Warren. They are getting educated for their own benefit, not because the government needs taxpayers. They then go forth into the world with their skills to (brace yourself, Ms. Warren) earn a living. If the factory owner offers an unappealing wage, people won't work there; if the product is undesirable, it won't be purchased. Free exchange by free people. The belief (Hope? Faith-based initiative?) is that this optimizes aggregate social well-being, subject to some sort of safety net for those who can't keep up. Obviously, the level of that safety net is a matter of debate.

Well. The social contract debate gets very normative and prescriptive. Ms. Warren's sense of compassion gives her lots of guidance about how the factory owner should organize his operation and compensate his workers, but she has never actually run a factory. And if the factory owner closes down his operation in the States and re-opens next week in Thailand rather than endure Ms. Warren's wacky sense of fairness and appropriate regulation, well, she will express her suprise and advocate for extended unemployment benefits for the workers she meant to help.

IN WHICH I CHANNEL MS. WARREN ON SPORTS IN ORDER TO DELIVER THE OBLIGATORY SPORTS METAPHOR:

FANTASY WARREN: Is A-Rod worth $30 million a year? He didn't invent baseball. And if we moved the fences back to 800 feet he would never hit a home run. So why is he paid anything at all?

FANTASY ME: Good point! And if we moved the fences to 800 feet and made the players hit golf balls off of tees, the Red Sox could quit paying John Lackey to "pitch". Ok, occasional infielders would be struck dead by golf balls, but maybe that would increase fan interest.

Or, we could imagine that the point of baseball is to create a framework with predictable rules so that players and teams can excel or fail within that framweork.

As background, it helps to know what has been happening to incomes over the past three decades. Detailed estimates from the Congressional Budget Office — which only go up to 2005, but the basic picture surely hasn’t changed — show that between 1979 and 2005 the inflation-adjusted income of families in the middle of the income distribution rose 21 percent. That’s growth, but it’s slow, especially compared with the 100 percent rise in median income over a generation after World War II.

Meanwhile, over the same period, the income of the very rich, the top 100th of 1 percent of the income distribution, rose by 480 percent. No, that isn’t a misprint. In 2005 dollars, the average annual income of that group rose from $4.2 million to $24.3 million.

So do the wealthy look to you like the victims of class warfare?

For heaven's sake - let's start by wondering whether it is the same group of people earning (on average) $24.3 milion year after year. A moment of reflection would suggest that it is not - a CEO who cashes in eight years of accumulated stock options and reports income of $40 million will appear in the top 100th of 1 percent in his cash-out year, but over the eight years he accumulated those options he was hardly earning A-Rod money. Obviously, averaging $5 million a year is still a high income, but the question is, when Krugman talks about "the wealthy" is he talking about the same people, or are there different winners each year?

This study (Income Mobility and the Persistence of Millionaires, 1999 to 2007, by Robert Carroll) of a panel of tax returns follows the same group of people from 1999 (the peak of the Clinton boom) to 2007 (before the Bush bubble burst). Some highlights:

Roughly half of millionaires during the 1999 through 2007 period attained this status just once during those nine years. Only 6 percent of this group were millionaires in all nine years.

The volatile nature of capital gains realizations appears to be a major explanation for the transiency of millionaires.

From his chart, I estimate that 50% of millionaires attained that status once in the nine years; 15% attained it twice, 8% three times, and another 8% four times.

So one possible (and partial) explanation of the rise in income inequality is an increased lumpiness in compensation. If there are a substantial number of people reporting one big income surge per decade (e.g., when they retire and sell their house or cash out stock options) then there will be an illusory increase in "the rich". Krugman must be aware of this phenomenon; first, he was cited in the study for a 1992 paper on this topic; closer to home, he surely segued through a very high bracket the year his best-seller boosted his income (his days as an Enron advisor when he got Money Calls were possibly less lucrative).

Let's be aware of this bit of projection from the Earnest Prof:

Now, I know how the right will respond to these facts: with misleading statistics and dubious moral claims.

Let's have a post debate thread. Did anyone fall in love with New Mexico's own Gary Johnson? I thought he loooked nervous and twitchy - was he running for President or trying to score an ounce somewhere? But I dozed off before he delivered the best line of the night.

And was I dreaming, or did I hear booing when Perry launched (yet another) attack on Romney?

Jon Huntsman seems to have tempered his "Vote for me if you hate Republicans as much as I do" message. Yike.

September 22, 2011

As we brace for the Republican debate (featuring the national debut of Gary Johnson), let's pick up on some LOL action from the left.

Steve Benen of Political Animal notes a NY Times pic of the Tampa debate in which Gov. Rick Perrydoes not have his hand over his hert during the pledge, although the other visible candidates do (Ron Paul, cropped nearly to oblivion, has his right hand at his side.)

This prompts Mr. Benen to jog down memory lane. Back in 2008 Obama slouched through the national anthem holding his crotch like a rapper, and (believe it or not!) some people questioned his patriotism. So why the double standard, wonders Mr. Benen?

Please. We will come to the long answer in a minute. The short answer is that this is a bit of a "gotcha" photo. At the Daily Beast, we see all eight candidates with a hand over a heart; the Denver Post settled for five (including Mr. Paul). For reasons that I imagine are mysterious to Mr. Benen, the Times picked the photo that showed Mr. Perry as out of the mainstream. (The Getty Image library is here; a search for "Republican debate Tampa" on September 12 indicates the range of choices.) Someone with a TiVo and too much free time could review the tape to see whether the Governor was slow on the uptake when the national anthem aired.

As to the long answer to why people were questioning Obama's patriotism, let cut to Obama's speech from the campaign where he tackled that very question:

Still, what is striking about today's patriotism debate is the degree to which it remains rooted in the culture wars of the 1960s - in arguments that go back forty years or more. In the early years of the civil rights movement and opposition to the Vietnam War, defenders of the status quo often accused anybody who questioned the wisdom of government policies of being unpatriotic. Meanwhile, some of those in the so-called counter-culture of the Sixties reacted not merely by criticizing particular government policies, but by attacking the symbols, and in extreme cases, the very idea, of America itself - by burning flags; by blaming America for all that was wrong with the world; and perhaps most tragically, by failing to honor those veterans coming home from Vietnam, something that remains a national shame to this day.

Well, yes. And today, earnest libs walk around explaining that America was stolen from the Native Americans, built on the back of slaves, and fought multiple colonial wars in the 20th and 21st centuries. We don't lead on greenhouse gases, we do lead in consumption of resources, and we are on a path towards planetary destruction. But they love America! They love it for what it might be one day, not for what it is right now (sort of like their love for Uncle Bob in rehab...).

Incredibly, not everyone is sufficiently nuanced to pick up on that as a patriotic vibe.

Here is a product that is focused like a laser beam on aspiring law students - the 180Watch. It's an analog watch with stopwatch capability and highights at thirty and thirty-five minutes.

I don't claim to fully to grasp the issues here, but the target market is people about to take the LSAT, and I do note this in the testing rules:

Items Allowed on the Desktop

Test takers may only have tissues, ID, wooden pencils, erasers, a pencil sharpener, a highlighter, and an analog (nondigital) wristwatch. No electronic devices are permitted. Neither are timers of any kind except analog wristwatches.

Wow - what time is it? Time to take the LSAT! There may be an app for it but you can't have your smartphone anywhere in sight. And my cheap twenty dollar digitial watch would also get the boot (but not my cheaper Fauxlex).

Well. We applaud the entrepeneurial spirit behind this design, not to mention the aggressive attitude that pushes to the edge of the rulebook. Law school, ho!

UNITED NATIONS — A last-ditch American effort to head off a Palestinian bid for membership in the United Nations faltered. President Obama tried to qualify his own call, just a year ago, for a Palestinian state. And President Nicolas Sarkozy of France stepped forcefully into the void, with a proposal that pointedly repudiated Mr. Obama’s approach.

The extraordinary tableau Wednesday at the United Nations underscored a stark new reality: the United States is facing the prospect of having to share, or even cede, its decades-long role as the architect of Middle East peacemaking.

Even before Mr. Obama walked up to the General Assembly podium to make his difficult address, where he declared that “Peace will not come through statements and resolutions at the U.N.,” American officials acknowledged that their various last-minute attempts to jump-start Israeli-Palestinian negotiations with help from European allies and Russia had collapsed.

The reporters get a bit nasty and petty with their close:

After Mr. Obama laid out his defense of the peace process, Mr. Sarkozy took to the same podium in a forceful disavowal of Mr. Obama’s position....

Somewhat incongruously, Mr. Sarkozy visited Mr. Obama’s hotel on Wednesday afternoon for a previously scheduled meeting with the president, and was effusive, in front of the cameras before the meeting, in his praise for Mr. Obama. Mr. Obama, for his part, refused to engage with reporters assembled for the photo op. “Do you support the French one-year timeline?” one reporter asked. Mr. Obama responded, “I already answered a question from you before.”

Another reporter asked Mr. Obama if he agreed with the French position on Palestine. Mr. Obama smiled and replied, “Bonjour.” A third reporter queried if that response constituted a “no comment.” The president’s response: “No comment.”

UNITED NATIONS — President Obama declared his opposition to the Palestinian Authority’s bid for statehood through the Security Council on Wednesday, throwing the weight of the United States directly in the path of the Arab democracy movement even as he hailed what he called the democratic aspirations that have taken hold throughout the Middle East and North Africa.

“Peace will not come through statements and resolutions at the U.N.,” Mr. Obama said, in an address before world leaders at the General Assembly. “If it were that easy, it would have been accomplished by now.”

Wait - did The One say that statements and resolutions were "just words"? Hmm - he has taken this 'talk is cheap' attitude before. Well, at least there is no mention of his Nobel Prize.

September 21, 2011

To the strains of "Where Has The Love Gone"? MSNBC runs this photo of Obama missing the memo on a group photo at the UN. Lest you wonder, photographers normally snap multiple photos, and The One did notmess upall of them.

Well, I recall the media having fun with Bush walking into a door back in the day (and Obama too? Hmm...). Still, it is interesting that MSNBC chose to depict the Man Who Got Bin Laden as a buffoon. This would never have happened if Keith Olbermann were still there!

WELL, YES: The photo does look photo-shopped as all get out, but I saw it at MSNBC...

September 20, 2011

Howard Dean applauds a new McKinsey survey saying that employers will dump their employees onto the subsidized exchanges at much greater rates than the CBO projected. Well, it gets small businesses out of the health insurance biz, and somebody else is paying for it, right? Does Howard Dean wonder who that somebody is? Obama is intent on raising taxes on small business owners, and when ObamaCare busts the budget (possibly by nearly $1 trillion over ten years), anyone still making money will be asked to hand it over.

(AP) BRUSSELS — U.S. Attorney General Eric Holder said Tuesday that the Obama administration will do its utmost to close the U.S. prison at Guantanamo Bay before next year's presidential elections despite political opposition.

And I'll do my utmost to keep a straight face while they try.

What was Holder's motive here -to finally resolve the age-old puzzle as to the sound of one hand clapping? Reminding the base of this belly-flop can't be a great way to fire them up.

It's great to know that across Red Sox Nation fans are looking at their t-shirts that say "I root for two teams; the Red Sox, and whoever is playing the Yankees" and shoving them to the back of the closet.

And knowing that Bard and Papelbon couldn't get it done tonight - sweet. Boston would be so much tougher if they had a real closer.

Gina Kolata of the Times presents a fascinating article about tricking athletes into a peak performance:

The trained bicyclists thought they had ridden as fast as they possibly could. But Kevin Thompson, head of sport and exercise science at Northumbrian University in England, wondered if they go could even faster.

In their laboratory, Dr. Thompson and his assistant Mark Stone had had the cyclists pedal as hard as they could on a stationary bicycle for the equivalent of 4,000 meters, about 2.5 miles. After they had done this on several occasions, the cyclists thought they knew what their limits were.

Then Dr. Thompson asked the cyclists to race against an avatar, a figure of a cyclist on a computer screen in front them. Each rider was shown two avatars. One was himself, moving along a virtual course at the rate he was actually pedaling the stationary bicycle. The other figure was moving at the pace of the cyclist’s own best effort — or so the cyclists were told.

In fact, the second avatar was programmed to ride faster than the cyclist ever had — using 2 percent more power, which translates into a 1 percent increase in speed.

Told to race against what they thought was their own best time, the cyclists ended up matching their avatars on their virtual rides, going significantly faster than they ever had gone before.

At this point I was thinking about Roger Bannister and his famous claim that the barrier to the four minute mile was mental. Et voila!

What limits how fast a person can run or swim or cycle or row? Is it just the body — do fatigued muscles just give out at a certain point? Or is the limit set by a mysterious “central governor” in the brain, as Timothy Noakes, professor of exercise and sports science at the University of Cape Town in South Africa, has called it, that determines pacing and effort and, ultimately, performance?

Until recently, exercise physiologists have mostly focused on the muscles, hearts and lungs of athletes, asking whether fatigue comes because the body has reached its limit.

But athletes themselves have long insisted that mental factors are paramount. Roger Bannister, the first runner to break the four-minute mile, once said: “It is the brain, not the heart or lungs that is the critical organ. It’s the brain.”

Not surprisingly, there is a limit to this added reserve:

He used the same method as before: Cyclists on stationary bikes raced an on-screen avatar going a bit faster than the cyclist’s own best time. In one group, the only variable was competition. Cyclists were told that the avatar would be going 2 percent faster or 5 percent faster than the cyclist had ever gone.

The other group was deceived. Each cyclist was told to compete against an avatar that would be moving as fast as that athlete had in his best effort. Actually, the avatar was programmed to race 2 percent harder or 5 percent harder. (A 5 percent increase in power translates into a 2 percent increase in speed, Dr. Corbett said.)

The cyclists in the first group gave up from the start when they knew the avatar would be moving faster than they ever had — even when the avatars were going 2 percent harder than the cyclists’ own best times. Instead, the athletes matched their own best efforts.

As had been observed in previous experiments, cyclists in the second group, who were deceived, kept up with their avatars when they were programmed to perform 2 percent harder than each athlete at his best. But 5 percent was just too much: The athletes kept up for about half the race, then gave up.

I would say this is of interest to "effort" sports, like football, basketball or hockey, where a roaring hme crowd might help an athlete find his motivation.

The President is not, as he claims “proposing real, serious cuts in spending.” His proposals would result in a tiny net reduction in spending: -$86 B over 10 years. Almost all of the spending cuts for which he wants to claim credit have already been enacted or accounted for. Almost all the new spending cuts he proposes would be used to offset higher spending in his Jobs bill proposal and for more Medicare spending on doctors.

The President is proposing about $1.5 T in higher taxes over ten years, offset by about $250 B of tax relief, for a net tax increase of almost $1.3 T.

Almost all of the President’s new proposed deficit reduction comes from tax increases.

And the ploy:

Simplifying even further, there is a perverse hidden logic to the President’s proposal. It goes like this: ”We cut spending in the spring and summer, so we’re going to propose almost all tax increases this time. That’s balanced.” If you reread the Presidential quote up top, you can see the rhetorical trick revealed:

THE PRESIDENT: … When you include the $1 trillion in cuts I’ve already signed into law, these would be among the biggest cuts in spending in our history. But they’ve got to be part of a larger plan that’s balanced …

You could be forgiven for thinking that the President is claiming that his new proposals are balanced, and that “the larger plan that’s balanced” is what he has proposed this month, consisting of equal-sized spending cuts and tax increases. That is the incorrect conclusion to which you are led, but technically the President is not claiming that. The “larger plan that’s balanced” is one that includes spending cuts enacted over the past six months. The “among the biggest cuts in spending in our history” are not those newly proposed, but those previously enacted.

Much as it grieves me to rally to the defense of Barack Obama, the latest AP Fact Check on his proposed Buffett Rule tax on millionaires seems to deliberately miss the point of Obama's pronouncements. From the AP:

WASHINGTON (AP) — President Barack Obama says he wants to make sure millionaires are taxed at higher rates than their secretaries. The data say they already are.

"Warren Buffett's secretary shouldn't pay a higher tax rate than Warren Buffett. There is no justification for it," Obama said as he announced his deficit-reduction plan this week. "It is wrong that in the United States of America, a teacher or a nurse or a construction worker who earns $50,000 should pay higher tax rates than somebody pulling in $50 million."

On average, the wealthiest people in America pay a lot more taxes than the middle class or the poor, according to private and government data. They pay at a higher rate, and as a group, they contribute a much larger share of the overall taxes collected by the federal government.

The 10 percent of households with the highest incomes pay more than half of all federal taxes. They pay more than 70 percent of federal income taxes, according to the Congressional Budget Office.

None of that is surprising, and none of it addresses the point being made by Obama. His point was not that most, or all high-earners pay a low tax rate; his point was that some high-earners do pay a low tax rate, and need to have it socked to them. Let's cut to the White House website for a clarification:

Finally, the President calls on the Committee to undertake comprehensive tax reform and lays out five key principles. Reform should:... 5) comport with the “Buffett Rule” that people making more than $1 million a year should not pay a smaller share of their income in taxes than middle-class families pay.

Obama's point is made clearly in his recent speech, which specifically cited the favorable capital gains rate:

So I am ready, I am eager, to work with Democrats and Republicans to reform the tax code to make it simpler, make it fairer, and make America more competitive. But any reform plan will have to raise revenue to help close our deficit. That has to be part of the formula. And any reform should follow another simple principle: Middle-class families shouldn’t pay higher taxes than millionaires and billionaires. That’s pretty straightforward. It’s hard to argue against that. Warren Buffett’s secretary shouldn’t pay a higher tax rate than Warren Buffett. There is no justification for it.

It is wrong that in the United States of America, a teacher or a nurse or a construction worker who earns $50,000 should pay higher tax rates than somebody pulling in $50 million. Anybody who says we can’t change the tax code to correct that, anyone who has signed some pledge to protect every single tax loophole so long as they live, they should be called out. They should have to defend that unfairness -- explain why somebody who's making $50 million a year in the financial markets should be paying 15 percent on their taxes, when a teacher making $50,000 a year is paying more than that -- paying a higher rate.

To respond, as the AP does, that most millionaires (or the average millionaire) is in compliance with that higher-taxes principal is not relevant. Obama wants to reform the tax code so that all high-earners meet that rule. (The AP does eventually nod to the caital gains differential in their eighth paragraph).

As to how Obama would achieve this without raising the capital gains tax and eliminating any dividend exclusions, I have no idea. And such an approach ignores the fact that taxes are normally collected at the corporate level before any capital gains are realized by shareholders, so there are double-taxation issues. In short I doubt that raising the capital gains tax is either a sensible or politically viable strategy. But it is an utterly banal liberal squawking point of the type we have come to expect from The One, and the AP rebuttal misses his point.

Put another way, if Obama announced a Chappaquiddick Plan to reduce drunk driving, it would hardly be responsive to note that 99% of Americans drive sober.

I LIKE WHERE HIS HEAD IS, BUT... This isn't political warfare; it's math. But the math is wrong. Daniel Indiviglio of The Atlantic does yeoman work attempting to estimate the revenue that might be raised by Populist Obama. However, hs is muddling averages and minimums, so his results are suspect.

For example, using 2009 data we learn that the average millionaire paid taxes at a rate of 29.1%. By applying an additional 5.9% tax to that group's total income, Mr. Indiviglio then estimates the additional revnue to be gleaned with a new tax floor of 35%.

However, that 29.1% average may be deceptive. Imagine, in a simpler world, that there are only two millionaires; Smith is paying an average rate of 20% on income of $1 million and Jones is paying an average rate of 40% on $1 million. The average rate for the two of them is 30%.

But Obama is not proposing to cut anyone's taxes. After his Buffett Rule is imposed, Smith will see his taxes rise to 35%. But Johnson's tax bill will remain at 40%. The average for the two men, after imposition of a minimum rate on one of them, will be 37.5%. In this example, the Indiviglio method would have projected additional revenue of $100,000 (5% of $2 million). However, the actual revenue increase would be $150,000 (15% on Smith's million plus nothing new from Johnson.)

That said, I expect that the revenue estimates from Mr. Indiviglio are in the ballpark, which is to say, we aren't talking about a lot of money. But Obama isn't proposing this scheme to collect revenue; he is proposing this to collect votes.

When the president said the unemployed couldn’t wait 14 more months for help and we had to do something right away, I believed him. When administration officials called around saying that the possibility of a double-dip recession was horrifyingly real and that it would be irresponsible not to come up with a package that could pass right away, I believed them.

I liked Obama’s payroll tax cut ideas and urged Republicans to play along. But of course I’m a sap. When the president unveiled the second half of his stimulus it became clear that this package has nothing to do with helping people right away or averting a double dip. This is a campaign marker, not a jobs bill.

It recycles ideas that couldn’t get passed even when Democrats controlled Congress. In his remarks Monday the president didn’t try to win Republicans to even some parts of his measures. He repeated the populist cries that fire up liberals but are designed to enrage moderates and conservatives.

...

This wasn’t a speech to get something done. This was the sort of speech that sounded better when Ted Kennedy was delivering it. The result is that we will get neither short-term stimulus nor long-term debt reduction anytime soon, and I’m a sap for thinking it was possible.

Yes, I’m a sap. I believed Obama when he said he wanted to move beyond the stale ideological debates that have paralyzed this country. I always believe that Obama is on the verge of breaking out of the conventional categories and embracing one of the many bipartisan reform packages that are floating around.

But remember, I’m a sap. The White House has clearly decided that in a town of intransigent Republicans and mean ideologues, it has to be mean and intransigent too. The president was stung by the liberal charge that he was outmaneuvered during the debt-ceiling fight. So the White House has moved away from the Reasonable Man approach or the centrist Clinton approach.

It has gone back, as an appreciative Ezra Klein of The Washington Post conceded, to politics as usual. The president is sounding like the Al Gore for President campaign, but without the earth tones. Tax increases for the rich! Protect entitlements! People versus the powerful! I was hoping the president would give a cynical nation something unconventional, but, as you know, I’m a sap.

I don't see Mr. Brooks climbing on the Rick Perry bandwagon, but he might be able to get behind Mitt Romney. Let's hope he avoids a flirtation with Jon Huntsman, whose campaign message of "I'm The Republican Who Doesn't Like Republicans" has not yet caught fire.

September 19, 2011

Did Obama's original stimulus package, aka the American Recovery ad Reinvestment Act, aka Porkulus I actually succeed? James Pethoukis says no and draws an intriguing rebuke from Ezra Klein. I am especially drawn to this:

To be sure, Pethokoukis’s second argument is far superior to his first: he quotes an analysis by John Taylor, a Stanford economist, which attempted to measure the extra spending — as opposed to the net paying down of debts — induced by the stimulus, and found little effect. Case closed?

Not really. A few months ago, Dylan Matthews and I attempted to do a comprehensive job on the subject, asking an array of economists from both sides of the aisle which studies they found most persuasive and then summarizing those studies, as well as their methodological strengths and weaknesses. We ended up with nine studies — including Taylor’s — and 4,877 words of summary. It was not an easy task.

And as far as I can tell, it’s not a task Pethokoukis even attempted. Dylan and I found that of the nine serious efforts to estimate the stimulus, six found substantial positive effects, two found no effect, and one found a slight effect. Taylor’s paper was nowhere near the most convincing of the bunch, and Taylor, a longtime spokesperson for Republican economic policies, is not the most convincing messenger, either. But Pethokoukis neither attempts to deal with the flaws in Taylor’s study — he gestures toward one of them and then misuses a quote Larry Summers gave me about “shovel-ready” infrastructure projects — or the contrary results in, say, Feyrer and Sacerdote.

A cross state analysis suggests that one additional job was created by each $170,000 in stimulus spending. Time series analysis at the state level suggests a smaller response with a per job cost of about $400,000. These results imply Keynesian multipliers between 0.5 and 1.0, somewhat lower than those assumed by the administration.

So we got less stimulus than the Administration promised. Already we have a baseline problem - if Team Obama predicted 3 million jobs "created or saved" and utterly credible outside analysts conclude the actual figure was 100,000, did the stimulus succeed? Critics claiming it cost the economy jobs are wrong, after all. On the other hand, 100,000 is a lot less than 3 million.

Mr. Klein does not explicitly address this quandary, but since he scores this paper among the "Stimulus Worked" set, I infer that he is setting a low bar. Certainly other critics have argued that, although the force of nearly $1 trillion surely created some jobs, the stimulus under-delivered (Mr. Klein quotes Douglas Holtz-Eakin to that effect). Since the Feyrer-Sacerdote paper does not describe the extent of the gap between their estimates and the Administration vision, I am withholding judgment.

Abstract: The American Recovery and Reinvestment Act (ARRA) of 2009 included $88 billion of aid to state governments administered through the Medicaid reimbursement process. We examine the effect of these transfers on states’ employment.

What? The $88 billion of Medicaid is roughly ten percent of the total ARRA package. Even if this slice was stimulative, that hardly speaks for the whole package.

In contrast to Chodorow-Reich, et al., I find no evidence of a positive Medicaid multiplier for total nonfarm employment, even when using the same instrument (pre-ARRA Medicaid spending). The difference likely derives from the control variables that I include and the fact that in my regressions I am also simultaneously controlling for the other two/thirds of ARRA spending.

That bodes poorly for the previous "Success!" paper, whose value was suspect in any case. Mr. Wilson's broader conclusion:

This paper estimates the “jobs multiplier” of fiscal spending – by sector, by type ofspending, and over time – using the state-level allocations of federal stimulus funds from the American Recovery and Reinvestment Act (ARRA) of 2009. Because the level and timing of stimulus funds that a state receives is potentially endogenous, I exploit the fact that most of these funds were allocated according to exogenous formulary allocation factors such as the number of federal highway miles in a state or its youth share of population. The estimates suggest ARRA spending created or saved about 2 million jobs in its first year and over 3 million by March 2011.

OK, that sounds like a success. I found a website that noted a "fallacy of composition" problem with this statistical technique, but let's checkthe scorecard. Where Mr. Klein had three "Success" papers, I have one gray area, one discard, and one success. Shall we press on?

Let's not. The next three "Success!" papers amount to re-running macroeconomic models to verify that yes, the models said that when money is spent jobs will be created, and they still say that if the money was spent, jobs must have been created. Pretty convincing. Here is the CBO, and Mr. Klein's summary of the issue is well worth repeating:

b) Prediction versus evaluation:Some critics have discounted the CBO’s studies on the stimulus as, in Reason writer Peter Suderman’s words, “pre-cooked”, because the multiplier estimates are based on evidence known before the stimulus was passed, and thus are sure to produce similar results before and after the stimulus was enacted. However, this is arguably a strength of the CBO approach. Attempts to determine the effect of the stimulus by comparing spending and employment data have to control for other factors are affecting employment, which can be tricky. A modeling approach avoids these pitfalls.

In other words, the CBO didn't get bogged down with messy details or untidy reality. And that's a good thing!

Finally, Zandi and Blinder used Moody's econometric model and, after running different scenarios, concluded that more spending created jobs, just like their model says. Mr. Klein delivers another laugher in describing this model:

Federal spending is treated as exogenous because “legislative and administrative decisions do not respond predictably to economic conditions,”

So the model which assumes Federal spending is independent of economic conditions is being used to evaluate an increase in government spending triggered by weak economic conditions. Am I alone in being troubled by that?

So six "Success!" stories have, by my grim reckoning, been beaten down to one success, one fogbank, and four for the round file. Hard to believe Mr. Pethoukis didn't even address any of these.

IT FAILED! On the "Stimulus Fail!" side of the ledger, Timothy Conley of Western Ontario and Bill Dupor of Ohio State University paper's confidence intervals drew a No Confidence vote from Noahpinion.

WASHINGTON — President Obama will unveil a deficit-reduction plan on Monday that uses entitlement cuts, tax increases and war savings to reduce government spending by more than $3 trillion over the next 10 years, administration officials said.

...

Mr. Obama will call for $1.5 trillion in tax increases, primarily on the wealthy, through a combination of closing loopholes and limiting the amount that high earners can deduct. The proposal also includes $580 billion in adjustments to health and entitlement programs, including $248 billion to Medicare and $72 billion to Medicaid. Administration officials said that the Medicare cuts would not come from an increase in the Medicare eligibility age.

Senior administration officials who briefed reporters on some of the details of Mr. Obama’s proposal said that the plan also counts a savings of $1.1 trillion from the ending of the American combat mission in Iraq and the withdrawal of American troops from Afghanistan.

Well, unless I am completely misunderstanding this, the $1.1 trillion of savings from winding down those two wars has already been factored into the Joint Select Committee deficit reduction baseline. Put another way, if the select committee could deliver $1.1 trillion of their original $1.5 trillion target simply by citing wind-downs in Iraq and Afghanistan, the process would hardly be fraught with suspense.

That being so, an honest news report would be that Obama seeks roughly $2 trillion of "new" deficit reduction, achieved by way of $1.5 trillion in tax hikes and $500 billion in Medicare/Medicaid cuts. That $2 trillion would meet the original $1.5 trillion goal of the deficit reduction committee and tack on Obama's supplemental goal of another $500 billion (roughly) to pay for his latest jobs bill (which he laughably described as "paid for").

NOW WHO IS CONFUSED, BESIDES ME? Let me regroup - per Keith Hennesey, under the current law baseline the Bush tax cuts are already set to expire, so the select committee cannot claim credit for that towards their $1.5 trillion target. However, nothing can stop Obama from playing games. From the Times:

Under Mr. Obama’s proposal, $800 billion of the $1.5 trillion in tax increases would come from allowing the Bush-era tax cuts to expire. The other $700 billion, aides said, would come from a combination of closing loopholes and limiting deductions among individuals making more than $200,000 a year and families making more than $250,000.

So really, Obama's $3 trillion plan includes $1.1 trillion of military savings and $800 billion of expiring Bush tax cuts already included in the Congessional baseline. In other words, the $3 trillion plan is a $1 trillion plan. Bold leadership!

September 18, 2011

Writing on the new Ron Suskind book about Obama's economic team, the WaPo includes a chilling detail about dysfunction in the White House:

Meeting over dinner at the Bombay Club one night, [director of the National Economic Council] Summers told [budget director] Orszag that “we’re really home alone,” according to the book. “I mean it,” Summers said. “We’re home alone. There’s no adult in charge. Clinton would never have made these mistakes.”

Obama, utterly lacking in executive experience? Who could have seen that being a problem?

Mr. Suskind got a non-denial denial from Mr. Summers:

Suskind asked Summers about the comment. “What I’m happy to say is, the problems were immense, they came from a number of very different sources, they were all coming at once, and there were not very many of us,” Summers replied.

And the WaPo got a more vigorous non-denial:

In an e-mail Friday to The Post, Summers, who left the administration last year, said, “The hearsay attributed to me is a combination of fiction, distortion, and words taken out of context. I can’t speak to what others have told Mr. Suskind, but I have always believed that the president has led this country with determined, steady and practical leadership.”

Well. I don't intend to re-read Bob Woodward's "The Agenda" about the early days of the Clinton Administration when they were dealing with the aftermath of the Bush 41 recession. But I will note that, as Undersecretary for International Affairs, Summers was an outsider in those debates. It was only later that Clinton's economic team became geniuses; in 1994, the portrayal of Clinton was not exactly that of an adult in charge. Here is our very own Andrew Sullivan:

It's page 289, and we still don't know [what this Presidency is about]. After listening to the Senator from Nebraska's subsequent demolition of the Clinton Presidency, the President's men simply parrot back that their boss agrees with everything Senator Kerrey says. At this point in the book, this is a credible statement. At this point in the book, Mr. Clinton seems to agree with everything anybody says.

Moreover, the President keeps having tantrums, so often and so violently that you come think of them as his way of keeping himself going. And his anguished indecisiveness can make Hamlet look like Fortinbras.

But eventually Clinton, Rubin and Sumers became the geniuses that gave us the Clinton tech bubble and dergulated financial services.

THE SUMMERS OF '93: Per my Amazon search of The Agenda, Lawrence Summers was passed over for chair of the NEC (the controversial memo about pollution and Africa) and relegated to the Treasury; he appears in a big pre-inaugural briefing held in Little Rock, and then drops out of the story.

September 17, 2011

The NY Times describes the latest Obama financial gambit with yet another smiley-face headline:

Obama Tax Plan Would Ask More of Millionaires

"Ask"? Can they really refuse? Geez, this may be a breakthough approach for the IRS - maybe we can put Jerry Lewis in charge of an April 15 telethon.

But no; the text indicates that the same coercive approach we have seen for decades will be employed:

WASHINGTON — President Obama on Monday will call for a new minimum tax rate for individuals making more than $1 million a year to ensure that they pay at least the same percentage of their earnings as middle-income taxpayers, according to administration officials.

Team Obama has already prepared the spin:

Mr. Obama, in a bit of political salesmanship, will call his proposal the “Buffett Rule,” in a reference to Warren E. Buffett, the billionaire investor who has complained repeatedly that the richest Americans generally pay a smaller share of their income in federal taxes than do middle-income workers, because investment gains are taxed at a lower rate than wages.

Billionaire, millionaire, whatever. Bill Clinton set his "millionaires tax" threshold at $250,000, so at least we are a baby step closer to matching rhetoric and reality. Of course, if Warren Buffet really wanted to pay more taxes, he could simply write a bigger check. Evidently, he wants other high-earners to write bigger checks as well, although his motive is murky (maybe he just wants to preserve his relative standing?)

Team Obama is offering just rhetoric at this point:

Mr. Obama will not specify a rate or other details, and it is unclear how much revenue his plan would raise. But his idea of a millionaires’ minimum tax will be prominent in the broad plan for long-term deficit reduction that he will outline at the White House on Monday.

In other words, they have no idea how much it will raise but they know it sounds good talking about it. Wow. Who can fail to be impressed by their careful planning and attention to detail?

Various "soak the rich" schemes are mooted by here (Sanders and Schakowsky) and here (Tax Policy Center).

Simultneously the NY Times (aka Obama 2012) presents the same poll results with this semi-smiley face:

Obama's Support Is Slipping Poll Finds But His Jobs Plan Is Well Received

That was revised in subsequent iterations and appeared on my dead tree edition as:

In Poll, Support For Obama Slips Among Base

So in TimesWorld Obama's support is slipping; the fact that ity has set a new low does not merit a headline. And the public support the jobs bill! Well, sort of - here is their puffery:

The president’s effort to seize the initiative on the economy was well received by the public, and clear majorities support crucial pieces of his new job-creation program....

[Big Skip and...]

The poll found that most Americans are familiar with the American Jobs Act, the president’s $447 billion proposal to create jobs. Almost half of the public is confident the plan would create jobs and improve the economy. A substantial majority of Americans support the main proposals aimed at creating jobs, including tax cuts for small businesses, improvements in the nation’s infrastructure and payroll tax cuts for working Americans.

And what did CBS see differently?

As for Mr. Obama's latest proposal to lower unemployment, the American Jobs Act he presented to Congress last week, the public is split. While 64 percent say they have heard about the bill, Americans are divided as to whether the plan will actually create jobs. Nearly half of Americans are at least somewhat confident that Mr. Obama's proposals will create jobs and stimulate the economy --12 percent are very confident and 36 percent are somewhat confident. But about the same amount -- 47% -- are not confident his plan will do that.

Let's go to the poll! At Question 61, p.19, the topic is Obama's jobs speech. As noted by CBS, 12% are "very confident" that Obama's "proposals will create jobs and improve the economy"; 36% are "somewhat" confident; 23% are "not very" confident; and 24% are "not confident at all".

I would say the public is split. [A Bloomberg poll had the public skeptical of the jobs bill by 51 to 40.]

Both news outlets provide some lighter moments. Here is CBS reporting on public sympathy for the grave burden Obama bears:

But half the public sees economic conditions as generally out of a president's hands - 53 percent now say the condition of the national economy is beyond any president's control and 41 percent of Americans have faith that the economy is something a president can do anything about. As a comparison, when this question was asked back in October 1992, 59 percent said the economy was something a president could do something about (35 percent said no).

In other words, just before Bush 41 was dumped 59% of the public agreed with Democratic Presidential nominee Bill Clinton that Bush ought to have been doing more to boost the economy. By way of comparison, in early August 2008, 67% of respondents thought the President could "do a lot", while only 26% thought the economy was beyond Bush's control (Question 21, p. 10). I'm only guessing that the press is more inclined to clamor for the President to "do something" when the President is a Republican. Fueling my parnoia are columns like this from Nick Kristof, ruminating about whether the media missed the big story on unemployment.

And what about He Who Must Not Be Named? CBS and the Times offer perspective on Obama's approval rating. From CBS:

With just over a year before Mr. Obama faces voters again for re-election, it should be noted that Mr. Obama's overall approval rating is similar to that of Bill Clinton's (43 percent) and Ronald Reagan's (46 percent) about a year before their presidential elections when they won re-election. Conversely, George H.W. Bush had a 70 percent approval rating about a year before the presidential election but then lost his bid for re-election.

And the Times:

The poll found a 43 percent approval rating for Mr. Obama. It is significantly higher than Jimmy Carter, who had an approval rating of 31 percent at a similar time in his presidency, according to the Times and CBS News poll, which showed Ronald Reagan with an approval of 46 percent and the elder George Bush at 70 percent.

So Obama is better doing than Carter and about the same as Clinton or Reagan. Not so bad! And we all know Bush 41 went on to defeat. Odd that both outlets overlooked the man Obama blames for all his difficulties. Since you ask, here is a Times story from Sept 23 2003 reporting on a CNN-USA Today-Gallup poll:

The poll also found that Mr. Bush's overall approval rating was the lowest since he became president, falling to 50 percent. In August, the poll found that 59 percent of American's approved of his job performance, and in April the figure was 71 percent.

September 16, 2011

The traditional Friday afternon collapsed time management open thread. At some point I hope to pile on to the LightSquareddebacle - a billionaire Obama crony plans to bring down our weather and military satellites, disable our cruise missiles and crash airplanes. But it would create jobs, and the lead investor is a Dem donor, so no worries.

September 15, 2011

Which scandal (if either!) will historians be shaking their heads about fifty years from now? At this point Solyndra looks more like a matter of statist corporatism going awry than it does a matter of crony capitalism. OK, the Solyndra story does involve secretive billionaire active in political causes, but it is Kaiser, not Koch, and the causes are liberal, so the media is not unduly exercised.

The current allegation is that the White House was pushing OMB for a quick up or down response on loans to Solyndra. I will say, based on my own experience trying to move deals past a credit committee, that deals that aren't pushed never overcome the natural and inevitable friction of the credit process. People can get fired for approving a loan that goes south; it is rare to see a person fired for requesting just a bit more information.

And back at Justice, "Fast and Furious" guns keep showing up at crime scenes. So far, however, the smoking guns are literally smoking guns; specific documentation of a high-level cover-up has not been found. Yet.

PUSHING A DEAL: From many years back, I still recall overhearing a colleague on the phone exhorting someone somewhere to do something that was Mission Critical to finalizing a transaction. Ahh, the pleasures of global finance:

"This has to happen today. There is no tomorrow. It's fourth and goal and we're going for it .... Uhh, that's a football expression. No, American football. I don't suppose telling you its the bottom of the ninth would be helpful... How about, we need a buzzer-beater? What's that, we are putting every one in the goal mouth? Yes! That's what we are doing. And we are doing it today!"

September 14, 2011

As best we can glean, Obama's current Job Plan is to offer a seemingly reasonable stimulus bill that has no chance of passage, and then run against a Do-Nothing Congress. The goal is to save one job, his own.

However, a new Bloomberg poll indicates that the Great Unwashed are not on board with Obama's Krugonomics:

A majority of Americans don’t believe President Barack Obama’s $447 billion jobs plan will help lower the unemployment rate, skepticism he must overcome as he presses Congress for action and positions himself for re- election.

...

By a margin of 51 percent to 40 percent, Americans doubt the package of tax cuts and spending proposals intended to jumpstart job creation that Obama submitted to Congress this week will bring down the 9.1 percent jobless rate. That sentiment undermines one of the core arguments the president is making on the job act’s behalf in a nationwide campaign to build public support.

Compounding Obama’s challenge is that 56 percent of independents, whom the president won in 2008 and will need to win in 2012, are skeptical it will work.

I am not a politcal genius like David Axelrod but if the public doesn't like the bill then failure to pass it may not hurt Republicans. Sometimes doing nothing is a real cool hand.

On another front, Dems are fretting that Obama has put Medicare and Social Security reform on the table, thereby reducing their opportunity to depict themselves as the last barrier between Granny and savage Republican entitlement cuts.

Republican Bob Turner wins the special election in NYC for the House seat formerly held by Anthony Weiner:

Turner’s victory is regarded as an upset given the Democratic history of the 9th district, which takes in portions of Brooklyn and Queens, as well as the fact that President Obama carried the seat by 11 points in 2008.

“New Yorkers put Washington Democrats on notice that voters are losing confidence in a President whose policies assault job-creators and affront Israel,” said National Republican Congressional Committee Chairman Pete Sessions (R-Texas) in a statement after Turner’s win.

Dems pretend this is no big deal:

In the run-up to Tuesday’s vote, Democratic party leaders were doing everything they could to de-couple those vote from any sort of national trend.

As evidence they cited the fact that Democratic performance in the district has been eroding for years. In the 2000 presidential election, Al Gore got 67 percent of the vote; Sen. John Kerry (D-Mass.) got only 56 percent in 2004, and Barack Obama 55 percent in 2008.

Moreover, Democratic strategists noted that they had a fairly weak candidate in Weprin, whose campaign was plagued by gaffes. He was chosen by party leaders largely because he promised not to challenge another incumbent in 2012, should his seat be eliminated in redistricting.

With New York slated to lose two seats due to growth over the last decade that lagged the national average, the 9th is considered ripe territory to be eliminated although no formal redistricting discussions have taken place.

It looks as if I should say a bit more about yesterday’s anniversary. So:

The fact is that the two years or so after 9/11 were a terrible time in America – a time of political exploitation and intimidation, culminating in the deliberate misleading of the nation into the invasion of Iraq. It’s probably worth pointing out that I’m not saying anything now that I wasn’t saying in real time back then, when Bush had a sky-high approval rating and any criticism was denounced as treason. And there’s nothing I’ve done in my life of which I’m more proud.

It was a time when tough talk was confused with real heroism, when people who made speeches, then feathered their own political or financial nests, were exalted along with – and sometimes above – those who put their lives on the line, both on the evil day and after.

So it was a shameful episode in our nation’s history – and it’s one that I can’t help thinking about whenever we talk about 9/11 itself.

So the country went in a different direction than he would have chosen, some people were mean to the former Enron advisor, and that is his key takeaway from 9/11. Whatever. Hundreds of first responders bravely gave their lives today, citizens rallied on United 93 to save the Capitol, but the main lesson is that Krugman was forced to endure (with Michael Moore) a lucrative role as Angry Lib.

But he did find a brief moment of shining pride:

Now, I should have said that the American people behaved remarkably well in the weeks and months after 9/11: There was very little panic, and much more tolerance than one might have feared. Muslims weren’t lynched, and neither were dissenters, and that was something of which we can all be proud.

No Muslims were lynched - are we a great nation, or what? I share his pride in our fellow citizens.

Now, do you wonder whether 9/11 is the only horribly tainted day on Krugman's calendar? Wonder no more! My ubiquitous secret spies have found his annotated calendar for 2011:

Martin Luther King Day: Our nation shares a collective and eternal guilt for the acts of a nutter gunman.

President's Day: We pretend to honor the President who owned slaves and the President who lacked the courage to free them in the border states.

Memorial Day: Dying in war glorified by the military-industrial complex.

Fourth of July: Ignorant partisans celebrate the founding of a nation stolen from Native Americans and built by slaves.

Labor Day: A once-proud day marred by the collapse of the Soviets.

Columbus Day: Again with the glorification of imperialism and conquest?

Election Day: How many blacks and ethnics will be turned away at the polls today? And why bother showing up, since the Supreme Court willl select the next winners anyway.

Veterans Day: When is "Peace Activists Day"?

Thanksgiving: Only the Mohegan Sun Casino marks the Native Americans victimized by the Pilgrims.

Christmas: We violate the separation of church and state to commemorate the birth of the man whose ideas led to the Spanish Inquisition.

New Years Day: Maybe the new year won't suck as hard. But I bet it does.

It's always cloudy in Princeton.

TO BE FAIR: it's not all gloom in Krug-world. I have no doubt a big smile illuminated Krugman's face as he reported that ObamaCare had succeeded in bending the cost curve. Ooops.

Megan McArdle pans Obama's job bill theatre before he even brings it to Broadway. Her gist, in two parts - (a) Team Obama is proposing a bunch of no-hope tax hikes to pay for the stimulus, so this is really political theatre rather than a serious attempt at governance; and (b) tax cuts offset by tax hikes provide very little net stimulus.

I am in agreement with (a) and partial agreement with (b). However, I quibble with this:

Of course, you can still argue that the bill will provide some stimulus, because maybe the stimulative multiplier on payroll tax cuts for the middle class is higher than the contractionary multiplier of tax hikes on the affluent. I might even agree with you. But why would you want a stimulus that relies on the delta between two fairly similar multipliers, when you could get much more stimulus by borrowing the money this year, and paying it back later, when we're richer? No matter how you look at it, unless these tax cuts happen well into the future, structuring the bill this way means that it will be much less stimulative than it could be.

Hmm. My strong hunch is that Team Obama is proposing stimulus based on one or two years of spending (e.g., continued unemployment insurance or refurbished schools and roads) and tax relief (such as the payroll tax holiday). However, the revenue estimates for such things as the limitation to itemized deductions seem to contemplate a conventional ten year CBO scoring horizon. (Let's note that per the Hill, the Administration estimates that limiting deductions in their new proposal will raise "about $400 billion." The Tax Policy Center, in their Aug 2 2011 paper, estimnated the revenue over ten years to be $287.9 billion over ten years. Maybe Team Obama has tweaked their proposal so that a direct comparison is not possible, or maybe the $400 billion is over a much longer time horizon.)

So - can two years of increased spending and reduced taxes offset by ten years of higher taxes produce a dramatic net stimulus, after adjusting for different multipliers and different time lags? Economic models that focus on lifetime income and taxation would probabaly say no; models that focus on current spending and taxation would say yes.

As to the truth, well, why ask me? FWIW, my Official Editorial Puzzlement remains this - there is a consensus among economists that short term tax changes (e.g., cash for clunkers, or one-time rebates) do not produce permanant changes in consumer behavior. Yet it is an article of unquestioned faith by Krugman and his acolytes that a short term increase in government spending offset by spending cuts and tax hikes down the road will produce a permanent change in behavior, resutling in increased investment and hiring.

The WSJ covers the Monday night Republican debate. Somehow, between the tennis, football, baseball and dinner invitation I missed the main event.

Let me excerpt this as a launch point for some brief Perry-bashing:

Former Pennsylvania Sen. Rick Santorum lit into Mr. Perry for opposing a wall on the U.S.-Mexican border and for offering in-state college tuition for many illegal immigrants in Texas. Mr. Huntsman said for Mr. Perry to suggest the border cannot be secured is "pretty much a treasonous comment."

Mr. Perry again defended his record. Of the legislation that offered in-state tuition, he said, "We were clearly sending a message to young people regardless of what the sound of their last name is that we believe in you."

I don't care about a person's last name. I care about spending taxpayer money on someone here illegally, whether they are from Mexico or the Auld Sod. Gov. Perry is simply parroting an offensive liberal squawking point when he suggests that opposition to illegal immigration is based on ethnic prejudice.

On the border fence, he said, "The idea that you're going to build a wall from Brownsville to El Paso and go left for another 800 miles to Tijuana is just not reality."

Let's not think of it as a border fence; let's think of its as a shovel-ready stimulus project. Dems will fall all over themselves to support it, and maybe Gov. Perry will, too.

Stanley Kurtz provides a history of the comparison of Social Security to a Ponzi scheme.

Writing in USA Today, Gov. Rick Perry says he intends to be "honest" with the American people:

Americans must come together and agree to address the problems so today's beneficiaries and tomorrow's retirees really can count on Social Security for the long haul.

We must have a frank, honest national conversation about fixing Social Security to protect benefits for those at or near retirement while keeping faith with younger generations, who are being asked to pay.

Team Romney would rather demagogue the issue with a flyer asking "How can we trust anyone who wants to kill Social Security?".

Hmm. That is a bit of an Eleventh Commandment violation. The normal justification for wild, exaggerated attacks is that the candidate can expect worse in the general election. I agree that Obama will probably have hi sback to the wall and be willing to say anything, but...

Apparently back in 2007 Obama was carving out new territory for himself (and rousing Paul Krugman's ire) by calling for long term solutions to the Social Security crisis. He might have a bit of a problem executing the full flip-flop come 2012.

And as an amusing aside, Chris Matthews recently got some attention by echoing Perry's Ponzi plaint. However, let's give Mr. Matthews props for intelluctual consistency - back when he was thrilling to Obama, Obama's comments on the need to fix Social Security prompted this Hardball exchange with the late Tim Russert (by way of Krugman):

Mr. Russert: “Everyone knows Social Security, as it’s constructed, is not going to be in the same place it’s going to be for the next generation, Democrats, Republicans, liberals, conservatives.”

Mr. Matthews: “It’s a bad Ponzi scheme, at this point.”

Mr. Russert: “Yes.”

It was a Ponzi scheme for Matthews when Obama wanted to fix it, and I guess it still is.

And going further back in time, Bill Clinton and Al Gore discovered that Social Security was in crisis in the late 90's when the alternative was Republican tax cuts. "Save Social Security First" and "Keep it in a lockbox" are the catchphrases of that era.

September 11, 2011

The master of his own narrative in print let the Republicans define the narrative in politics. And Obama likes to come in late, after the other players have staked out positions. It’s a strangely risk-averse tact, given the fact that he took two of the boldest risks in history — jumping into the presidential race in the first place and giving the kill order on Bin Laden on sketchy intelligence.

The "boldest risks in history" include Obama's entry into the 2008 nomination race? What?!? Just for starters, if a decision is risky it is because there is a dramatic downside. Had Obama lost to Hillary in 2008, would his political career have been over? His life? No more book deals? Would it really have been unthinkable that he would rise from the ashes in 2012 or 2016, at the advanced age of 55?

I am having a hard time ranking that on the same scale with Caesar crossing the Rubicon or Eisenhower tracking the weather reports and ordering the D-Day invasion or Kennedy arm-wrestling with Kruschev over the Cuban missiles but then, I am not MoDo.

As to ordering the hit on bin Laden, I would be more impressed with the risk involved if any of the alternatives (bombing, continued surveillance) had strong support from top advisors.

Oh, what is my point - that MoDo has the judgment and detachment of a schoolgirl watching Elvis? No kidding.

What happened after 9/11 — and I think even people on the right know this, whether they admit it or not — was deeply shameful. Te atrocity should have been a unifying event, but instead it became a wedge issue. Fake heroes like Bernie Kerik, Rudy Giuliani, and, yes, George W. Bush raced to cash in on the horror. And then the attack was used to justify an unrelated war the neocons wanted to fight, for all the wrong reasons.

The commemoration is subdued? How odd - nothing says "Let's Party" like the deaths of 3,000 civilians. Well, Krugman got his Nobel Prize for Economics, not psychology.

I watched a bit of the memorial service at Ground Zero. Two strangers would go through about six names from the alphabetized list; then they would read off the name of their father, mother, brother, sister, niece, or whatever, say a few words, and move off-stage. Some of the readers were totally composed, but most got a bit choked up when they got to their loved one. Watching twenty year-olds say good-bye to a mother they lost when they were ten isn't easy, but watching a forty year old cop lose it when saluting his father is not so easy even for a cold-hearted, insensitive right-wing troglodyte like me.

Now, I suppose it is possible that the family members were choking up because they were reflecting on the Iraq War and the grim reality that Gitmo remains open. Or perhaps they were subdued by concerns over the Patriot Act and warrantlesss wiretapping. I am not smart or sensitive enough to be a lib like Krugman, but I didn't see it that way.

The memory of 9/11 has been irrevocably poisoned; it has become an occasion for shame. And in its heart, the nation knows it.

Wow. I'll let you know when I am ashamed of the heroism of the United 93 passengers, or New York's Finest or Bravest. But don't be holding your breath.

FWIW: Krugman is not allowing comments at his site but Steve Benen, a like-minded lib, has comments open at Washington Monthly. Lots of support for Krugman's perspective, and some lefty push-back to which I won't be contributing - it's their day, too, and if they need to hate me, well, whatev.